Chicken, the infant industry that never grew up

Oct 08, 2012 Letters

Dear Editor,
About fifteen years ago the government placed a barrier on the importation of foreign chicken, based on the argument that Guyana’s chicken industry was in its infant stage and therefore needed protection to fully blossom.
That decision by the policy makers seemed a good idea at the time. It allowed several Guyanese the economic space to trade in the chicken market, creating jobs for local people and earned a profit for investors as well as purchased inventories from other sectors. Unfortunately, the consequences of this decision have been painful to those who buy chicken on daily basis.
Chicken consumers have always had to pay a higher price per pound after this trade barrier was erected. The cost (could be in the hundreds of millions of GY dollars) this barrier has on our society is huge and can be greater if government doesn’t reform this industry and force it to grow sooner.
Currently, the big players in this industry are laid back, not investing in the right inputs to ensure the industry can compete without any protectionist policy. This is not withstanding the increases in tonnage produced every year. Investment is not at the level it could be if there were to be the possibility that investors in this industry had to compete with foreign players, essentially becoming a grown up industry.
If this possibility were to exist, then we would see greater investment into research and development, technology that will ensure that chickens are bred in the most efficient manner, an increased square footage of pens under cultivation and an improved hatchery facility.
All these measures would ensure that the production cost of chicken in Guyana is reduced and an increased in pounds of chickens available to the Guyanese consumer. The price for chicken would fall. This would be good news for the poor who spend most of their income on food.
The welfare of society would improve citrus paribus, regardless of how minute, but my thinking is that, welfare would increase greatly, as we are a chicken eating nation, twenty plus tonnes consumed in 2011.
Our experience with the sugar industry should give an understanding of the dangers that lie ahead.
If another country somehow manages to successfully challenge such protectionism or the World Trade Organisation is to change its stance on this type of policy, then we would be unprepared to trade and compete with other countries that are comparatively more efficient in this industry. We would be running around putting together action plans that would not work, as is the case for GUYSUCO.
We may even end up panic spending to equip the industry to stand on its own feet, which, as in GUYSUCO’s case, taxpayers would feel the blunt of the spending. Foreign chicken would sell more and replace our inefficient, unprepared chicken industry.
This would have implications for our food security and balance of trade. We would need more foreign currency to pay for this produce and the impact on Guyana’s welfare could be adverse in the long run. So let us not repeat the mistakes of the sugar industry and plan and invest for the future.
I strongly believe it is time we rethink Guyana’s long run position with poultry production and set the policies that will allow for a proactive investment strategy, not the one we currently enjoy.
Malachi James

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Chicken, the infant industry that never grew up

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